Get the Right Stocks in Your Portfolio

To know where you're going, you have to see where you've been.

My real-money Rising Star portfolio is designed so you can follow along and achieve a well-rounded, diversified portfolio of your very own. Now that I'm a few recommendations in, I want to step back and assess where we are at this point.

First, here's a look at the stocks I've bought and their performance to date:

Company

Date Purchased

Return

Coca-Cola(NYSE: KO)

Nov. 30, 2010

6%

Coca-Cola

Dec. 31, 2010

2%

lululemon athletica(Nasdaq: LULU)

Jan. 12, 2011

23%

Johnson & Johnson(NYSE: JNJ)

Feb. 28, 2011

(2%)

Abbott Labs(NYSE: ABT)

Feb. 28, 2011

4%

lululemon athletica

March 24, 2011

13%

II-VI(Nasdaq: IIVI)

April 5, 2011

(2%)

So far, so good. There's no way to draw any meaningful conclusions after just a few months, but getting off to a good start is certainly better than the alternative!

When I started the port, I established the following allocation guidelines:

Large caps

45%

Mid caps

15%

Small caps

15%

International

25%

I won't be too much of a stickler about hitting these percentages, but this is a pretty good guideline for most people. After buying five stocks over seven different purchases, here's how it shakes out so far:

Company

Market cap (millions)

Size

Value

% of Port

Coca-Cola

$155,200

Large

$1,080.32

28%

lululemon athletica

$6,600

Mid

$1,283.94

33%

Johnson & Johnson

$163,400

Large

$477.16

12%

Abbott Labs

$78,500

Large

$505.75

13%

II-VI

$1,500

Small

$542.08

14%

Totals

$3,889.25

100%

So that gives me 53% large-cap exposure, 33% mid-cap, and 14% small-cap. I have exposure to health care, retail, technology, and however you want to define Coca-Cola (sugar water industry?). I really like the way things are shaping up.

It's also pretty easy to see where our next stop should be: international. This is sort of a squirrely category to begin with (to use a technical term). After all, Coke, Johnson & Johnson, II-VI, and Abbott Labs all have more than half their sales overseas. But all my stocks are headquartered in the U.S., and I do want to branch out some more to get some internationally based companies in the mix.

Author

Rex Moore spent his formative years in Texas, and fought beside Davy Crockett at the Alamo. He currently travels the globe for TMF, bringing back video reports on conferences and companies that matter for investors.